Authorities target rice millers over paddy grading, prices

Aug 23, 2013 News

By Leonard Gildarie
Regulators of the rice industry are holding out hope that West Demerara farmers will be able to reach an agreement with Guyana Stockfeeds Limited, over prices from the last crop.
Several rice farmers yesterday met with representatives of the Guyana Rice Development Board (GRDB) and the Guyana Rice Producers Association (RPA) at the latter’s head office at Crane, West Coast Demerara.
According to Dharamkumar Seeraj, RPA’s General Secretary, the organization is prepared to take the issue to the Commercial Court.
Farmers are claiming that the East Bank Demerara-based miller paid them under $4,000 and below, for different grades of paddy, far below what was being competitively offered on the market.

GRDB General Manager, Jagnarine Singh (far left) speaking with concerned West Demerara farmers yesterday.

Both GRDB and RPA are now in talks with Guyana Stockfeeds for a possible solution.
According to Seeraj, also a Member of Parliament for the ruling People’s Progressive Party, from all indications the milling company, which produces the Angel brand rice, has been receiving good prices for its packaged products. There are no reasons why some of this should not have been passed down to farmers, he said.
GRDB’s General Manager, Jagnarine Singh, pointed out that the last crop of rice this year was a difficult one as the Venezuela rice deal had not been fully finalised and farmers were worried about markets. As a matter of fact, he said, GRDB and RPA were both visiting millers and imploring them to buy as much rice as possible from the farmers, in a move to avert possible losses.
For this crop, with Venezuela taking a significant amount of rice from Guyana, the situation has eased somewhat with less stress on farmers to find markets. The situation of prices has been a longstanding issue with farmers fighting for prices.
Initially, there were no worries for millers as they took rice under a credit scheme and took ages to pay farmers. Government had accused millers of using farmers’ money to finance their own operations, to the detriment of the industry. However, a crackdown by GRDB saw a number of legislative changes which forced millers to pay within a certain time after collecting the paddy. Interest was charged and even the confiscation of the licence resulted, once the credit arrangements were breached.
However, another scenario is emerging. Farmers are complaining now of lower, unrealistic prices being given by millers. There are more complaints also from farmers who say that they believe that their paddy is unfairly graded which resulted in them receiving lesser prices.
Both Seeraj and Singh admitted yesterday that there have been instances found of millers manipulating the system.
Farmers are now being urged to ensure that they be present while their paddy is being graded.
According to Singh, there are several systems in place to also ensure farmers are not robbed. These include inspections of the scales at the mills by the Guyana National Bureau of Standards, a functioning moisture meter, and even a price list being posted up prominently.
Officials of the milling companies also have to make themselves available to farmers, even to the point of sharing their phone numbers.
While farmers traditionally would sell their paddy to any millers offering them a good price, the situation has started to change in recent years with the Venezuelan PetroCaribe deal in which Guyana buys oil from Venezuela and rice is supplied to that neighbouring country. The moneys are written off by GRDB, which is overlooking the process, and is the one paying farmers who are participating in the scheme.
According to Seeraj yesterday, RPA is not unaware of instances of millers lowering prices once there is a glut in the market or “lots of trucks” in front of the mills.
He recommended that farmers will have to start considering harvesting their paddy and storing these until the prices are right. Ensuring that the moisture content and quality of paddy are up to standard will definitely see better prices being offered.
While Government has privatized its rice facilities, in the Essequibo coast, Region Two, there is now a consideration for the establishment of a US$1.5M facility that will take off 100,000 bags of rice per crop. This 5,000-bag per day facility will more than likely target the Venezuela market.
Seeraj noted that from the price offered by the Venezuelan market, there is the feel that farmers on an average should receive $4,000 per bag of paddy.
Meanwhile, both entities stressed that they were looking into complaints that millers have been illegally offering farmers “D” grade and “E” grade for paddy sold. Under new CARICOM standards, grades are A, B, or C and somewhere in between are acceptable. Moves are now being made to determine a price for quality that cannot be graded for a possible formula for a price.
Last year, rice production broke records with 422,058 tonnes. Some 334,000 tonnes were exported, with more than half of this going to Venezuela.
With this year’s first crop some 264,000 tonnes, and another 250,000 tonnes targeted for the coming crop, it is anybody guess whether farmers will be able to meet the 500,000-tonne mark this year.

1 thoughts on “Authorities target rice millers over paddy grading, prices”

besmart August 23, 2013 at 11:36 am

This grading racket is a repeat of what the PNC did when they were in power…please let us stop this from happening again. paddy graders make more money than the rice farmers…..by collecting bribe money…believe me we know what is going on.

Comments are closed.

Latest News